McDonald’s Corp. (MCD) has somehow managed to keep their momentum and post strong sales during a tough time for the U.S. economy, Wall Street and exchange traded funds (ETFs).
In this day and age, people really love a bargain. As of November, the fast food purveyor posted 55 months in a row of increases within global same-store sales, reports Andrew Martin for The New York Times. It’s a strong comeback for a company that had been written off as unhealthy and irrelevant not long ago. How did it happen?
- This six-year rebound has been triggered by more enticing food and less expansion
- A more health-conscious menu
- Longer hours
- A kid-friendly atmosphere
The momentum could continue, too. The company’s CEO says they’re recession-resistant, but there’s some question as to whether they’re depression-resistant. Only time will tell, since they’ve never gone through one.
That’s Not All. Another fast food type company that is posting double digit gains is Yum Brands (YUM), which has a better prospect than most for 2009. Although Yum isn’t immune to a downturn in the economy, the company has managed to dodge slashing its work force, trimming dividends and selling any holdings, reports Mark Caggeso for Money Morning.
Yum also has not had to put a hold on any 2009 expansion plans and is still going to build 1,400 restaurants in international markets. About 500 stores are going to be into China, one of its strongest markets, with a target of 10% profit growth going into 2009.
- PowerShares Leisure & Entertainment (PEJ): down 0.33% for past three months; McDonald’s Corp. 7.5%; Yum Brands 6%
- Consumer Discretionary SPDR (XLY): down 5.2% for past three months; McDonalds Corp., 10.5%; Yum Brands, 2.2%
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.